As part of the Brexit process, UK Visa & Immigration (UKVI) will be changing the UK visa system to reflect the status of the country after we leave the EU. As well as changes to the rights of EU citizens under the EU Settlement Scheme, the Home Office have made substantial changes to other routes of entry to the UK, under Tier 1 (Entrepreneur) visas with two new categories known as ‘Start-up’ and ‘Innovator’ visas and tightening up the existing rules for Tier 1 (Investor) visas. These changes took effect from the 29 March 2019.
Tier 1 Investor visa
This category of visa is available where an individual is able to invest at least £2,000,000 in the UK. An applicant would be able to take into account money owned either jointly with or solely by a spouse or same-sex partner, but if so would also have to provide evidence confirming that they have permission to use this money in the UK.
Applicants must open a UK bank account prior to making their investment and the new rules require that banks carry out due diligence and ‘know your client’ checks and provide a statement for the Home Office confirming that they have done this. Applicants must also have held the relevant funds for at least two years (previously this was three months) and if not must provide evidence to show the source of the funds, for example from an inheritance or the sale of another asset.
In another significant change, the purchase of UK government bonds will no longer count as permitted investments. Instead, within three months of arriving in the UK the applicant must invest £2,000,000 or more in share or loan capital in active and trading UK registered companies, though the new rules also allow the use of intermediary vehicles if regulated by the Financial Conduct Authority. As currently, no account will be taken of companies that are mainly involved in property investment or its management or development or the purchase of residential property.
An applicant with a visa in this category may stay in the UK for up to 3 years and 4 months and may thereafter apply to extend this for a further 2-year period. After 5 years an applicant would be able to apply to settle in the UK, sometimes referred to as ‘indefinite leave to remain’. This period reduces to 3 years if at least £5,000,000 has been invested and to 2 years if at least £10,000,000 has been invested. However, spouses and dependants would have to have spent 5 years here before they may apply to settle.
After living in the UK for 5 years an applicant may be eligible to apply for British citizenship provided that in the last year they had held indefinite leave to remain; otherwise the period would be 6 years. Spouses and any dependent children would have to live in the UK for 6 years before they could apply for this.
This is a new category of visa for individuals or ‘entrepreneurial teams’ who wish to set up a business in the UK. There is no minimum funding requirement, but applicants must have their business idea endorsed by an authorised body from an approved list: either a specified UK higher education institution or a business organisation supporting entrepreneurs. The authorised body must provide an endorsement letter confirming that the applicant has an original business idea that meets market needs; that the applicant has the relevant skills, knowledge or experience; and that there is potential for job creation. Applicants would be expected to stay in regular contact with the body that endorsed them and the Home Office are likely to interview them on their business idea.
An applicant under this visa category would be able to stay in the UK for up to 2 years, but would not be able to apply to extend this.
This is another new category of visa for individuals who wish to set up or run a business in the UK. No investment funds are required if the applicant’s business has already been established in relation to an existing visa, otherwise applicants must have at least £50,000 in investment funds. The funding can come from any source. If any of the monies are held by the applicant they must provide bank statements to confirm the funds have been held in a financial institution regulated by the Financial Conduct Authority in the UK for at least three months or are held outside but are transferable to the UK. It is possible for applicants to form an ‘entrepreneurial team’ with other individuals applying under this visa category, but they cannot share the same investment funds and each team member would require to have at least £50,000 to invest.
In addition, applicants must also have their business idea endorsed by an authorised body, being a business organisation supporting entrepreneurs from an approved list. As above the authorised body must provide an endorsement letter confirming that the applicant has an original business idea that meets market needs; that the applicant has the relevant skills, knowledge or experience; and that there is potential for job creation. If the business is an existing one, the endorsement letter must confirm that the applicant has made significant progress meeting targets on their business plan; that the business is active and trading and that it appears to be sustainable for at least the following 12 months. Again, applicants would be expected to stay in regular contact with the body that endorsed them and the Home Office are likely to interview them on their business idea.
An applicant with a visa in this category may stay in the UK for up to 3 years and may thereafter apply to extend this for a further 3-year period. Please note that an applicant may be able to apply to settle in the UK after they have been here for 5 years, provided that their business meets specified criteria regarding its growth, minimum annual gross revenue and the creation of full-time equivalent jobs for resident workers.
Anderson Strathern advises individuals and organisations of various sizes and complexity on immigration issues and is well placed to advise those seeking entry to the UK under Tier 1. We are able to assist with the completion of applications and in advising on and drafting appropriate letters and documentation to support applications.